2018 (8) TMI 250 - AT - Service Tax

Tribunal allows Cenvat credit on pre-registration service tax for renting immovable property

The Tribunal upheld the decision to allow the appellant to avail Cenvat credit on service tax paid for Renting of Immovable Property Services before the ... CENVAT Credit - rent paid for the period, prior to registration - Held that:- The main reason why the Cenvat credit has been disputed by Revenue is that the premises for which rent was paid along with service tax was not part of the centralised registration till it was granted to the respondent with effect from 28.1.2015. It is further seen that the application for such centralised registration was submitted as early as on 9.1.2013, but the same was granted only in 2015. Similar issue decided by Tribunal in the case of CCE & ST Vs. Samsung India Electronics Pvt. Ltd. [2015 (11) TMI 1570 - CESTAT ALLAHABAD], where it was held that a service provider can avail Cenvat credit of Service Tax paid on various input services, as long as the said services are used for providing output-taxable services. Credit remains allowed - appeal dismissed - decided against Revenue. Issues:- Dispute over availing Cenvat credit on service tax paid for Renting of Immovable Property Services prior to centralised registration of premises.Analysis:The appeal was filed against the Order-in-Appeal No. 862/2017-18, challenging the denial of Cenvat credit to the appellant for service tax paid on Renting of Immovable Property Services before obtaining centralised registration for the premises. The department contended that since the rent was paid before registration, the Cenvat credit was impermissible. However, the lower authorities, relying on a Tribunal decision in a similar case, held that the credit cannot be denied. The Revenue argued that the credit may not be allowable as the premises were not part of the registration. On the other hand, the respondent argued that the Tribunal's decision was upheld by the Allahabad High Court and thus, the benefit should be granted. After hearing both sides, the main contention was that the premises were not part of the centralised registration until 2015, even though the application was made in 2013. The Tribunal referred to the Tribunal's decision in a similar case, where it was held that a service provider can avail Cenvat credit on input services as long as they are used for providing output-taxable services. The Tribunal upheld the impugned order based on this decision and rejected the Revenue's appeal.In conclusion, the Tribunal upheld the decision to allow the Cenvat credit to the appellant for service tax paid on Renting of Immovable Property Services before the premises were included in the centralised registration. The decision was based on the principle that as long as the input services are used for providing output-taxable services, the Cenvat credit can be availed. The Tribunal's decision in a similar case, supported by the Allahabad High Court, was crucial in determining the outcome of the appeal, ultimately leading to the rejection of Revenue's appeal.